South African coal exports see big drop in January
Coal exported from South Africa's Richards Bay Coal Terminal (RBCT) dropped 38% month on month in January, according to port authority data released on Thursday.
Coal exports picked up significantly in the last quarter of 2012 with market participants pointing out at the time that RBCT works towards annual shipment targets, selling aggressively in the last few months of the year. RBCT shipped 6.8m tonnes in December, which dropped to 4.2m tonnes in January.
Stocks at the terminal jumped 52% in January to stand at 4.1m tonnes, with almost 1m tonnes more coal sent by producers to the port during the month than in December. Year on year, stocks are also up by 17%.
South African physical coal is generally considered to be too expensive to price into Europe at the moment, with one source saying FOB RB prices are about $4/tonne off. The only exception is one trading house, which has an off-take agreement in place and it fixed some freight rates competitively last year, according to several sources.
Stronger demand in February might come about if workers for Colombia's biggest coal producer, Cerrejon, go ahead with their planned strike. Negotiations are continuing, according to a note from the Colombia coal workers' union Sintracarbon, with a new deal on the table from Cerrejon.
However, demand from China, which has yet to really materialise for South African coal, could be even more muted in February because of Lunar New Year celebrations this weekend. But the effects on coal trade can last for longer. Fionn O'Raghallaigh
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